Southwest Airlines SWOT Analysis Southwest&nbspSWOT

Excerpt from SWOT :

Customers complain of smaller cramped seats and hence an uncomfortable flight experience. This is because Southwest wants to accommodate as many passengers as it can in one flight and its seats are thus smaller than those found in other airlines. This is especially uncomfortable for those who need extra space due to physical challenges.

The other weakness of Southwest is its customer on-plane experience. Owing to the cost concern, Southwest put as many seats as possible in the planes and only single class seat, economic. It means that the size of a seat in Southwest's airplanes is smaller than a seat in other airlines' aircrafts. Thus, there are some customers could feel uncomfortable with the smaller seats because those customers' physical issues, like the football players. Therefore, the Southwest might loses the business of those customers with special issues.

Threats:

The threats always come from external environment. And external environment includes governmental policies, economic situation and certainly the competitors. While Southwest had fewer or no competitors in low fare industry for some time but with the entrance of JetBlue, Southwest is facing fiercer competition. JetBlue has distinct advantage over Southwest in some areas and this can prove detrimental to Southwest's future. JetBlue came in 1998 and has become a major competitor. It has newer fleet of aircraft and has also adopted newer technology. It offers a more pleasant experience to customer with personal TV sets and radio system within the flight. It also has fewer seats which means customers do not feel cramped and enjoy a more comfortable flight.

JetBlue is also serving those destinations that Southwest has ignored. While Southwest chooses to serve only smaller airports due to cost concerns, JetBlue has not adopted this strategy and is offering flights from many major locations. This is a serious threat to Southwest since many of its potential customers now have the option to choose JetBlue.

The external situation is also not favorable due to the restrictions on airlines imposed after September 11 attacks. There have been more safety costs now than ever before and this is taking a toll on the financial health of most airlines. While Southwest has managed to do well, it cannot entirely escape the effect of these measures.

Opportunities:

Interestingly the very issues which are weaknesses or threats for a company also can become hidden opportunities. Southwest has the experience and reputation behind it which means it can confidently enter areas where other airlines might not want to enter just yet. It can serve more destinations and more airports. While the company wants to stick to its low cost strategy, it cannot ignore the fact that most of its potential customers are flying out of major destinations so even if it doesn't offer flights from major airports, it can choose a smaller airport in the same location and cover more destinations. For example instead of flying out of Miami International Airport, it can choose to operate from Fort Lauderdale airport or Opa Locka airport. But at least Miami would be covered and Southwest won't lose customers

The company also needs to attract new customers and hence increase its customer base by advertising more often and using varied channels of communication. No company can ever sit still with its current customer base because there are many competitors and numerous threats. Hence it must enhance its base by attracting new customers through innovative communication strategies.

Conclusion

Southwest enjoys an envious place in the airline industry today because of its operation model and its low cost strategies. But there has been a decline in its profit which indicates that company may not be as financially sound as it was once. However this can be attributed to the slow down in the economy and generally poor condition of the airline industry. But regardless of these, Southwest needs to pay attention to this and improve its services in whatever matter it can so that it can thwart the potential threatening elements and also gain more customers.